Gift Shop - Business Gateway

Gift Shop

This pack has been designed to provide information on setting up a business in the Gift Shop industry in Scotland,
as well as helping to inform the market research section of your business plan. You can find more information on
how to write a business plan from the Business Gateway website (www.bgateway.com/businessplan), including
an interactive template and tips to get you started.

This market report was updated by Business Gateway in January 2021. If you find the information contained in
this document useful, tell us about it! Send us feedback here; we will use your comments to help improve our
service.

What do I need to know about the Gift Shop market?
The following summary statistics have been taken from market research reports and reliable resources that the
Information Service uses to compile industry information. They should give you an indication of how your industry
is faring at present and whether there is demand for your type of business:

    ♦   Gift purchasing for seasonal events in 2020 was down notably compared to 2019 due to the negative
        impact of COVID-19. In 2020, the percentage of consumers purchasing any gift for Mother’s Day was
        down 7.5% (54%) compared to 2019 (58%), while gift purchasing for Father’s Day and Easter declined a
        respective 5.9% and 12.1% as both events were celebrated in lockdown. Easter saw the biggest decline as
        nonessential stores were forced to close and the UK experienced its COVID-19 peak. (Mintel, Seasonal
        Shopping (Spring/Summer): Inc Impact of COVID-19, UK, October 2020).
    ♦   September brought the first signs the UK was heading towards a second wave and notably concern levels
        have once again risen, with the mid-October data showing the highest level of concern for three months.
        Levels of concern are significant as they are a good indicator of more ‘lockdown-led’ behaviours from
        shoppers. As concern levels have risen, we have seen the number of shoppers looking to limit time spent
        in stores rise once more, up to 45% (8-19 October), the highest level seen since July. The number
        shopping from local businesses (26%) has also edged up to its highest point since July. (Mintel, Christmas
        2020 UK: Prospects for Gifting, November 2020).
    ♦   At the beginning of 2020-21, the industry observed strong online demand, as social distancing measures
        prevented non-essential stores from opening, resulting in gift card and voucher sales falling by 5.4% on a
        like-for-like basis, according to the Gift Card & Voucher Association (GCVA). However, demand for
        greetings cards persisted, despite these measures preventing people seeing their loved ones during the
        spring season, which includes important days for the industry such as Valentine's Day, Easter and
        Mother's Day. As a result, the market for online greeting cards has expanded substantially. Analysis by the
        GCVA and KPMG UK found digital and eVoucher sales grew by 49.7% in the first half of 2020 compared
        with the same period the year before. (IBISWorld, Online Greetings Card Retailers- UK, December 2020).
    ♦   The non-photo personalized gifts market in Europe was valued at $5.73 billion in 2019 and is likely to
        reach $8.94 billion by 2024, growing at a CAGR of 9.30% during the forecast period. Product launches and
        innovations are among the leading factors supporting the value sales in Europe. (Technavio, Global
        Non-photo Personalized Gifts Market 2020-2024).
    ♦   The national organisation for this industry is The Giftware Association. Other industry bodies
        include British Independent Retailers Association, British Allied Trade Federation and the Crafts
        Council.

Where can I find more information on my market?
The Information Service has access to a number of databases which can offer more detail on this industry. Some
of these reports are listed below - if you would like to be sent extracts from any of these reports, please contact
us on 0300 013 4753 or email info@bgateway.com.

    ♦   Mintel - Seasonal Shopping (Autumn/Winter): Inc Impact of COVID-19 - UK (April 2020). The effects of
        COVID-19 on seasonal shopping are likely to materialise in the medium term with consumers holding back
        spend on celebrating seasonal events. Gifting of small-ticket item are likely to drive spend and consumers
        are likely to engage in more experience-led activities to celebrate. This includes dining in which has
        previously been popular but even more so post COVID-19 as people cut back on indulgences like eating
        out.
    ♦   Technavio - Global Gifts, Novelty, and Souvenirs Market (2019-2023) - Personalization of gifts is a major
        trend, which enhances sales and fuels the growth of the market. It also helps small gift and souvenir
        retailers develop long-term relationships with customers and encourage repeat business for the
        companies. It also adds value to standard gifts. Hence customers usually seek personalized gifts.
        Personalized gifts are also popular as gifts retirements, promotion, birthdays, new year eves, and
        women’s day. To address this growing demand for personalized gifts, vendors are introducing gift
        personalization services.
    ♦   Mintel - Gifting in Beauty & Personal Care_ Inc Impact of COVID-19, UK (April 2020). With sustainability
        being a hot topic in the BPC category in 2020, brands need to rethink the amount of packaging waste in
        gifting. . . In the gifting sector, brands could introduce packaging with additional functions such as bags or
        boxes that can be used for other purposes. In-store recycling initiatives could be a way to bring gift
        recipients into retailers, encouraging the purchase of other products.
    ♦   IBISWorld – Florists in the UK (December 2020). Many florists have attempted to boost revenue through
        the supplementary sale of champagne, wine, balloons, toys, chocolate, cards and other gifts. . .The
        revenue attributed to this segment is expected to have declined at a slower rate than arranged cut
        flowers during the COVID-19 (coronavirus) pandemic due to the growing popularity of giftware products
        amongst consumers.

There are also a number of online resources you may find helpful:

    ♦   Gift Focus Magazine (www.giftfocus.com) This giftware trade magazine offers a number of useful
        resources, including, newsletters and articles on the giftware industry, issues of the monthly Gift Focus
        magazine and a trade supplier’s directory.
    ♦   Salience – 2020 Gift Market Report (tinyurl.com). A downloadable market report providing statistics on
        the online gift market and key opportunities for companies in the industry.
    ♦   Visit Scotland Coronavirus (COVID-19) advice (tinyurl.com/). Shopping in Scotland page (tinyurl.com).
        talks about uniquely Scottish shops, fairs and markets and town centres.

Disclaimer: This report has been updated in January 2021 - we have included Post COVID-19 market
material where available. Please note that this research may contain copyrighted material. Copyright
belongs to the holders credited above and, as such, recipients of this research reproduce and
repurpose this information at their own risk.

How can I find out about my competitors?
Business Gateway’s online guide to Competitor Analysis explains how to find your competitors, how to research
what they’re doing and how to act on what you learn about them.
Immediate competition will be from other businesses in your local area. There are several online directories
which can be used to find company information and generate lists easily and at no expense. Many Local
Authorities also publish local business directories on the web. Below are some key web resources:

    ♦   General business directories such as Yell ,Thomson Local or Google Maps
    ♦   Trade specialists like EuroPages (European directory), The Wholesaler or Free Index
    ♦   Business to business (B2B) specialists such as Kompass

Likewise, your local Chamber of Commerce may publish a members’ directory; find your local Chamber on the
Scottish Chambers website.

Once you’ve identified who your competitors are, the next step is to gather information on the way they do
business. Which services do they provide? How do they market themselves? How much do they charge?
To learn about your competitors:

    ♦   Look for articles or adverts in local newspapers, trade press and directories.
    ♦   Try to read their marketing material; if the company has an online presence, visit the company’s website
        as a first port of call. Not only does it give you a better understanding of the company’s activities, it can
        also offer a wealth of information such as a company history or staff biographies, as well as the
        company’s partners or suppliers
    ♦   Search for information on limited UK companies via the Companies House website
    ♦   Gain an insight into your competitor’s performance using credit checks and the accounts that limited
        companies are required to submit to Companies House each year.

We can provide credit checks free of charge; if you are interested in using this resource, or looking for us to help
you find relevant publications, please contact us by emailing info@bgateway.com or by calling 0300 013 4753

What about suppliers?
Choosing and Managing Suppliers can help you decide what you need from a supplier, how to identify one and
how to choose one to deal with.
Trade associations or industry specific organisations may also be able to recommend suppliers or contacts. You
can also use the aforementioned resources for finding competitors to find suppliers.

Once you have decided on a supplier, we can run a credit check on the company to help assess their financial
stability. We provide credit checks free of charge; if you are interested in using the resource please
info@bgateway.com or by calling 0300 013 4753.

Who are my customers?
Your business plan should include information about the customers you would expect. Business Gateway’s guides
on Market and customer research will help you to identify new trends, opportunities, customers and competitors.
It can be useful to group your customers by geographical location, age or lifestyle. The websites listed below are
freely available and can provide most of this information. If you can’t find what you’re looking for from these
website, please contact us and one of the team will be happy to help:

    ♦   Access the latest population estimates from the National Records of Scotland (NRS). NRS also offers
        demographic factsheets for each council area in Scotland, which can provide summary statistics for the
        area you will be based in.
    ♦   Information from the most recent census in 2011 is released via the official website. See in particular the
        Census Area Profiles. Clicking on your area of interest will give the latest population figures, including
        estimates by age.
    ♦   Understanding Scottish Places has interactive profiles of towns and cities across Scotland. It can be useful
        for understanding the interrelationships and flows between towns, and also gives comparisons between
        two or more places.
    ♦   Scottish Government Statistics provide accurate and up-to-date statistics on Scotland, covering
        population, health, education and housing.
    ♦   The Scottish Household Survey provides information on the structure, characteristics, attitudes and
        behaviour of Scottish households, both at a national and local level.
    ♦   Office for National Statistics (ONS) is the recognised national statistical body for the UK. ONS covers a
        wide range of demographic, economic and social issues at a UK level.

How can you help me with other aspects of starting my business?
The Business Gateway website has guides, videos, online tutorials and tips on all aspects of starting up a business
in Scotland. Follow the links below to explore each resource:

Accountancy                                                          Pricing
Institute of Chartered Accountants of Scotland’s                     Business Companion Pricing & payment guide.
(ICAS) “Find a Chartered Accountant” tool                            Please note: the most effective way to research
                                                                     pricing is to conduct your own research – visit
Funding                                                              wholesalers or suppliers to obtain price lists, find
                                                                     quotes from similar companies and work out what
Practical information on finance and funding for
                                                                     other businesses in your area are charging
starting and growing your business

                                                                     Promotion
Insurance
                                                                     BG guides to Marketing
Business insurance guide

                                                                     Training
Legal Help
                                                                     Skills Development Scotland’s My World of Work
Gov.uk “Licence Finder” tool
                                                                     Funding for training
Law Society of Scotland’s “Find a Solicitor” tool
                                                                     Small Business Bonus Scheme (Scotland)

     Your local Business Gateway can offer events, workshops and 1:2:1 support on all aspects of starting and
     developing your business. Call the helpline on 0300 013 4753 to find out what is available in your area.

     We hope you find this Market Report useful and we’d love to hear your feedback here.

Although every effort has been made to ensure the accuracy of the information provided, Business Gateway will not be held
liable for any inaccuracies or omissions in the data supplied, or for the content of any website that the document above may
contain links to. By using this information, you accept this disclaimer in full. Also, please note that Business Gateway does not
endorse any business or individual that may be referred to above.

You must not rely on the information in the report as an alternative to advice from an appropriately qualified
professional. If you have any specific questions speak to your Business Gateway Advisor or consult an appropriately
qualified professional.

Last updated: January 2021
Updated by: Jessica